TOKYO, July 21 (Reuters) - Benchmark Japanese government
bonds slid on Tuesday as domestic markets reopened after a
holiday, while energy-linked inflation pressures weighed on
sentiment ahead of a sale of super-long-term debt.
Here are a few details:
* The 10-year JGB yield climbed 2.5 basis
points to 2.73%. Yields move inversely to bond prices.
* U.S. Treasury yields rose sharply overnight, as investors
weighed whether rising oil prices tied to the widening U.S.-Iran
conflict could feed into inflation and keep the prospect of a
Federal Reserve hike alive.
* Japan's Ministry of Finance will sell about 300 billion
yen ($1.85 billion) of 40-year JGBs on Wednesday.
* "Today's JGB market is expected to see selling pressure
dominate. Higher crude oil prices and U.S. Treasury weakness
during the holiday period are likely to be viewed as factors
prompting sales," Keisuke Tsuruta, a senior bond strategist at
Mitsubishi UFJ Morgan Stanley Securities, wrote in a note.
* "The ultra-long-term bond segment may face some downward
pressure due to rising market volatility and the upcoming
auction of 40-year government bonds tomorrow," he added.
* Markets are also looking ahead to the Bank of Japan's
meeting, due next week, when it is expected to keep rates on
hold.
* "Given that the market has largely priced in interest rate
rises at a 'cruising speed' of once every six months, the focus
of this Bank of Japan policy meeting will be on if there's any
suggestion of an acceleration in the pace of hikes," Noriatsu
Tanji, chief bond strategist at Mizuho Securities, said in a
note.
($1 = 162.4800 yen)